22-01-2021 09:00

Business strategy: Just “set it and forget it” — or dynamic and adaptive?

Taru Möller, Head of Transaction Banking Value Propositions at Nordea, discusses how the changing preferences of customers means companies should be looking to make their operations more dynamic and adaptive with real-time capabilities able to respond to shifting demands.
Open Banking Expert's Opinion - Taru Möller

Nordic countries are highly digitised and today’s customers have become more demanding in how they want to engage with the companies they interact with. New technologies have caused a shift in customer expectations, resulting in a new kind of modern buyer: a customer that is always connected, aware of its wants and desires, and expecting instant and flexible delivery options. Spiced additionally by the impact of the ongoing COVID-19 pandemic, it has become critical for today’s companies to make operations dynamic and adaptive, build real-time capabilities to track changing customer preferences and create more caring digital customer journeys.

Driven by customer requirements

We are living in the age of the customer. Nordea’s Treasury 2025 survey revealed that over 80 per cent of mid-sized companies in the Nordics today see emerging customer requirements as the key driver for business model innovation, followed by new emerging technologies and competitive business models. Customer driven innovation means innovation that is created in response to an unmet need in the marketplace. To make it successful, companies need to understand their customers better as well as why to collaborate with them and how. It also requires new capabilities to utilise the data, shorten development cycles and adapt the business to changing customer needs.

Key drivers for business model innovation among mid-sized corporates (Nordea Treasury 2025 Report)

Adapting to change

All companies, both small and large, are surrounded by change influencing on operations, workflows and processes. The sooner the company can adapt to the change, the better off they will be. This often means having the capability to accelerate time to market, to build agility in the ways of operating and developing products and services, and to utilise new technology and digitalisation for the creation of new types of digital excellence.

Historically, mid-sized companies have had difficulties in gaining market share from larger competitors. As small- and mid-sized corporates become more familiar with new emerging technologies, this is about to change. Nordea’s survey reveals the new technologies that finance and business leaders in mid-sized companies are adopting by 2025 — and the top five are closely connected to big data and automation. Harnessing big data can help mid-sized companies to uncover hidden patterns and correlations, and drive data-driven insights to improve overall performance and spot changes in customer demand. Connected with AI (Artificial Intelligence) and machine learning, corporates can improve the customer experience and manage change operations by optimising warehouses, delivery options and improving inventory.

Percentage of mid-sized companies likely to adopt new technologies by 2025 – finance vs business respondent view (Nordea Treasury 2025 Report)

Leveraging APIs

As we enter a new decade of emerging technologies, application programming interfaces (APIs) have emerged as one of the key elements of technology modernisation at many businesses. Today´s changing customer demands, workflows and processes require the ability to link systems and data, and here APIs play a crucial role in making business systems more responsive and adaptable.

Companies that use APIs can benefit in many ways. Better utilisation of APIs improves business adaptivity and resilience, helping the business to optimise day-to-day workflows, spot productivity gaps and improve operational efficiency throughout the value chain. Extending of the business — or adapting to a rapid business change — comes quicker, enabling the company to create more engaging ways of meeting the customers in the way they desire — and where they are today. Several studies show that an increasing number of consumers are more likely to do business with a company that can provide a personalised experience. If people aren’t able to seamlessly integrate their digital engagements, they will turn to a competitive option. Through digitalisation, the change has become easy and many companies struggle to maintain the customer loyalty.

Change means accepting unknowns

Open banking can additionally speed up the digital transformation in the company by creating new opportunities to innovate. Offering the right product at the right time makes the purchase decision more likely and favourable. By utilising the Open Banking APIs, the company can integrate a financing offering for purchases when the customer needs it, helping them to complete the purchase from a single digital location — with the payment terms relevant for them.

Often businesses are slow to change — and change requires a lot of hard work and accepting unknows. However, there is no going back and staying static; the digital world is always changing and evolving. The good news is, that companies that do transform digitally have a lot to gain: their products are more likely to attract customers and highly engaged customers buy not only more, but also more frequently, leading to an increase of sales.

About Taru

Taru is responsible for the propositions unit within Nordea Transaction Banking. She has 20 years of experience in sales, innovation and business development in the marketing, finance and telecom industries. Taru has a particular interest in changing business models, digitalisation and business resilience through customer needs driven business innovation.

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